FRCN to release not-for-profit governance code to curb fraud

The Financial Reporting Council of Nigeria (FRCN) said the finalised Nigeria Not-for-Profit Sector Governance Code (NNFPGC) would be released later this year to promote best practices in financial management while mitigating fraud and misuse of funds in the sector.

The Executive Secretary and Chief Executive Officer, Dr Rabiu Olowo disclosed this during a stakeholder engagement and consultation in Lagos. He said the new code aimed to attract both local and international funding, driving sustainable socio-economic growth in the country.

Olowo, during the gathering of feedback on the draft governance code from stakeholders, said the code is designed to raise ethical standards and improve the operational effectiveness of non-profit organisations in Nigeria.

Olowo stressed the importance of this initiative, especially as Nigeria ranks 154th out of 180 countries in Transparency International’s Corruption Perception Index, with a score of 24/100. The ranking underscores the urgent need for improved governance across all sectors.

He said by adopting the new governance code, Nigeria’s non-profit organisations will be better positioned to attract local and international funding, collaborate with government and private sector entities and contribute significantly to the country’s socio-economic development.

Olowo added that the success of the new governance code would professionalise the sector, encourage non-profits to adopt structured governance and enhance board composition, accountability, transparency and sustainability, ultimately building trust with donors, beneficiaries and the public.

He said the gathering of feedback on the draft governance code represents a crucial phase in its development, which is aimed at elevating ethical standards and improving operational efficiency in the non-profit sector.

Olowo also acknowledged the controversy following the introduction of a similar governance code in 2016, which was suspended due to insufficient stakeholder engagement and mandatory stipulations that sparked widespread opposition.

According to him, the new draft seeks to avoid those earlier missteps, drawing from lessons learned and fostering broader collaboration with stakeholders.
He emphasised the importance of strong governance in maintaining public trust and enhancing the credibility of Nigeria’s third sector, which plays a vital role in social services, advocacy, and development initiatives.

Olowo expressed optimism that the finalised governance code will significantly strengthen and enhance the credibility of the not-for-profit sector, contributing to a more resilient and inclusive economy.